Wittal: Spring and speculation have sprung

Our online grain markets columnist Brian Wittal welcomes feedback and information on market conditions in your area, such as current offering prices, basis levels, trucking premiums and special crops contracts. Contact Brian today.

March 25 — Financial markets were down most of the day, but they did end up at the close, which is a good sign of continued support at these levels.

The Dow Jones closed up 90 points. The U.S. dollar finished down 0.4 cents; the Canadian dollar is down 0.57 cents and closed at US81.06 cents.

Crude oil finished down $1.21, closing at US$52.77 a barrel.

Corn finished down seven to eight cents a bushel, beans are down 16-18 cents a bushel and wheat is down 24-33 cents a bushel.

Canola is down $1-$3 per tonne and barley finished down $1-$2 per tonne.

Grain markets were quiet again, with little commercial trading happening the past couple of days. That, along with some profit-taking from market speculators after the recent rally, was enough to push most of the grains into double-digit losses.

The U.S. Department of Agriculture’s planting intentions and inventory report is coming out Tuesday (March 31) and it’s widely expected that soybean acres will be up significantly this coming year.

Other key numbers to watch for are total world stocks of beans and wheat. Add to that the current weather concerns, as seeding approaches throughout North America, and markets are on edge, not knowing which way to go or why.

So, every little piece of news is going to get a reaction in these markets as is evident by the weather forecast changes yesterday calling for rain in the drier wheat-growing regions of the U.S. Wheat futures have taken some hard losses today, purely from that change of forecast.

Spring grain markets are always very interesting, as almost everything is based on speculation going forward: how many acres will be seeded, what will the yields be, will there be weather problems? Add to that worldwide financial uncertainty, and you have a real roller-coaster ride ahead for the next several months until we are into harvest and can realistically answer some of those questions.

That’s all for today. — Brian

— Brian Wittal has spent over 27 years in the grain industry, including as an elevator manager and producer services representative for Alberta Wheat Pool, a regional sales manager for AgPro Grain and farm business representative for the Canadian Wheat Board, where he helped design some of the new pricing programs. He also operates his own company providing marketing and risk management advice for Prairie grain producers. Brian’s daily commentaries focus on how domestic and world market conditions affect you directly as grain producers.

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